Muh Tweets

Tag: hurricane

The New York Times looks at our national policy of paying to rebuild vulnerable coastal communities, no matter how ill advised their developments might be. In effect, we’ve encouraged people to upscale their beachfront shanties into expensive vacation homes, increasing the value at risk next time a storm hits. As the seas rise, ever more money will be sent down this gopher hole. Instead, we should prohibit future development, map out the most vulnerable locations, and draw up buy-out offers ahead of time, so when disaster strikes, it can be used as an opportunity to re-direct investment into less risky areas.

As the entire eastern seaboard slowly recovers from its lashing by Sandy, insurance companies are bracing for the hurricane’s aftermath and the possibility of another Katrina-scale loss. If there’s any major incumbent business with an incentive to publicly acknowledge the risks and costs of climate change, it’s the insurance industry, and especially the re-insurers — mega-corps that backstop individual insurance companies by pooling their risks globally. These companies can do the math, and what they’ve seen over the last couple of decades is a steady upward trend in both the number of extreme weather events and the resulting insured losses that they’ve been on the hook to cover. The situation is well summarized in a new report from Ceres, entitled Stormy Futures for U.S. Property/Casualty Insurers. They suggest that insurers face an existential risk from climate change.